Pawapuri Rice Mills vs Bihar State Food and Civil Supplies Corporation Ltd. & Ors.
Background
This is a batch of appeals by rice millers in Bihar arising out of the 2011-12 Custom Milled Rice (CMR) procurement scheme, under which millers were to procure paddy from farmers and supply milled rice to the Bihar State Food and Civil Supplies Corporation for the Public Distribution System. Disputes arose over dues claimed from the millers, and the Corporation sought to recover these dues as a "public demand" under the Bihar and Orissa Public Demands Recovery Act, 1914 through certificate proceedings before a certificate officer. The millers challenged these recovery certificates by writ petition, arguing the amounts claimed did not qualify as a "public demand" under the Act and that the certificate officer had not properly determined this threshold ("jurisdictional fact") before proceeding.
Decision Breakdown
The Supreme Court held that whether a claim qualifies as a "public demand" under Section 3(6) of the 1914 Act is itself a jurisdictional fact that the certificate officer must determine before proceeding to recover the amount, and that the definition of "public demand" is deliberately broad and not confined to specific illustrative categories. However, the Court found that the millers had approached the High Court by writ petition without first exhausting the statutory remedies available to them under the Act to contest the recovery certificates before the appropriate authority. The Court declined to examine the millers' procedural objections itself, dismissed the civil appeals, but granted the rice millers a fresh thirty-day window to pursue their statutory remedy under the Act, directing that such remedy be entertained without regard to delay or limitation.
Lesson Learnt
Before rushing to a writ court to challenge a demand for recovery of dues, a person should first exhaust the specific statutory remedy the law provides for disputing that demand. Courts will generally decline to bypass such statutory mechanisms, though they may give a fresh opportunity to use them properly.